Blindsided. The Pentagon and CIA chiefs reportedly stunned that the president is opening the door to bringing back outlawed methods of torture. Will the president listen to top Republicans who are adamantly pushing back?

And Q tip. A glass ceiling is broken in the secretive world of British spies. It turns out the MI6 tech expert famously depicted in the James Bond movies isn't a man in real life. She's a woman.

We want to welcome our viewers in the United States and around the world. I'm Wolf Blitzer. You're in THE SITUATION ROOM.

ANNOUNCER: This is CNN breaking news.

BLITZER: Breaking news tonight: Mexico's president cancels a planned visit to the White House next week, as tensions escalate over President Trump's new moves to start building a wall along the border.

Mr. Trump says the talks would have been fruitless unless Mexico agrees to pay for the wall. The White House press secretary suggested a 20 percent tax on Mexican exports to the United States may be one possible way to cover the wall's costs.

For the first time, Republican leaders in Congress are revealing how much U.S. taxpayers will have to pay up front to build that wall. They say they expect the Trump administration soon will request between $12 and $15 billion to fund the wall's construction.

Another story we're following, President Trump expected to move forward with his call for a formal investigation of unsubstantiated allegations of major voter fraud. The White House says Mr. Trump will sign an executive order, maybe tomorrow, maybe Saturday, instead of tonight, as anticipated. We're told the details are still being worked out.

And about a week into his presidency, Mr. Trump just wrapped up his first flight aboard Air Force One. He traveled to Philadelphia to speak at a retreat for Republican lawmakers and promote his agenda. We're going to talk about the war over the border wall with the former U.S. ambassador to Mexico. Tony Wayne is standing by, along with our correspondents and analysts, as we bring you full coverage of the day's top stories.

Jim, we're seeing a widening rift between the Trump administration and a major U.S. ally.

JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT: That's right, Wolf.

And it appears that Donald Trump's plan for Mexico to pay for the wall on the U.S. border is very much a work in progress. Earlier today, White House Press Secretary Sean Spicer told reporters that the president was considering slapping a tax on Mexican goods of 20 percent coming into the U.S. to force Mexicans to reimburse U.S. taxpayers for that wall.

But just in the last hour, Wolf, Sean Spicer called reporters back in and said that that tax is only one of a number of options under consideration at this point. It is just another example of how building a wall is easier said than done.

(BEGIN VIDEOTAPE)

ACOSTA (voice-over): Just as President Trump stepped off of his maiden voyage as commander in chief on Air Force One, he landed in his first diplomatic controversy and, for a change, all eyes weren't on his Twitter feed, but on the tweets coming from Mexican President Enrique Pena Nieto, who announced in blunt Trump fashion that he has informed the White House he will not be attending a meeting scheduled next week with the new American president, a protest of President Trump's plan for a massive new wall on the border.

ENRIQUE PENA NIETO, MEXICAN PRESIDENT (through translator): Mexico does not believe in walls. I have said time and again Mexico will not pay for any wall.

ACOSTA: Mr. Trump all but invited Pena Nieto to scrap the trip, tweeting: "If Mexico is unwilling to pay for the badly needed wall, then it would be better to cancel the upcoming meeting."

ACOSTA: At a GOP leaders retreat in Philadelphia, the president said the decision to cancel was mutual.

TRUMP: The president of Mexico and myself have agreed to cancel our planned meeting scheduled for next week. Unless Mexico is going to treat the United States fairly, with respect, such a meeting would be fruitless.

ACOSTA: And he touted another part of his immigration plan, the swift removal of undocumented criminals.

TRUMP: They're going to be gone, fast.

ACOSTA: Top Republicans in Congress are now examining ways to pay for the wall, which comes with an estimated price tag of at least $12 billion.

SEN. MITCH MCCONNELL (R-KY), MAJORITY LEADER: We intend to address the wall issue ourselves, and the president can deal with his relations with other countries on that issue and other issues.

ACOSTA: House Speaker Paul Ryan's advice to Republicans, buckle up.

REP. PAUL RYAN (R-WI), SPEAKER OF THE HOUSE: This is going to be an unconventional presidency. I think you know this by now. And I think we're going to see unconventional activities like tweets and things like that, and I think that's just something that we're all going to have to get used to.

[18:05:02]

ACOSTA: While Republican leaders are following the president's path on Mexico, they are flat out rejecting his latest defense of the use of torture on terror suspects.

MCCONNELL: I believe all of my members are comfortable with the state of the law on that issue now.

QUESTION: And torture is illegal?

RYAN: And torture is not legal. And we agree with it not being legal.

ACOSTA: But the president warned his party he is not backing down from an agenda he sees as essentially to keeping Americans safe, both overseas and on the streets of U.S. cities.

TRUMP: You look at Chicago. What's going on in Chicago? I said the other day, what the hell is going on? That is why we will continue to stand with the incredible men and women of law enforcement.

(END VIDEOTAPE)

ACOSTA: And while President Trump will not be welcoming Enrique Pena Nieto to the White House next week, he will be sitting down with the British prime minister, Theresa May, at the White House tomorrow. They will hold a joint news conference, Wolf.

That will be his first with a foreign major leader. But at this time, even though both leaders are set to talk about that special relationship that exists between the U.S. and the U.K., it's very likely that many of the questions tomorrow will be about that wall -- Wolf.

In fact, there's been significant pushback. As soon as that news came out that that was a possibility that the White House was exploring to impose a 20 percent tax, you saw several Republican senators tweet about their concerns, including Senator Ben Sasse of Nebraska, Senator Lindsey Graham of South Carolina, saying they could be an impediment to economic growth, and Senator John McCain as well raising concerns.

The broader concern, among the Republicans, is that Donald Trump may be starting a trade war with one of the country's largest trading partners. And this party, by and large, on Capitol Hill, supports expanded trade, not just with Mexico, but around the world. John Cornyn, who represents Texas, that border state with Mexico, raising significant concerns about the calls, these threats by Donald Trump to pull out of NAFTA, for instance, saying that doing so would be a significant impediment for American businesses in the United States and in his home state of Texas.

So, this is an issue that is bound to spark a fight with his party, if he does decide to go down this road. And, Wolf, that's probably one reason why Sean Spicer walked it back immediately afterwards, once this news broke and he saw the reaction from his own party.

BLITZER: Yes, the reaction was pretty intense.

Manu, how much support might President Trump need from Congress to actually enact these possible plans?

RAJU: He will need the support of Congress to enact at least the spending portion of this. They're talking right now about sending a separate spending bill up in the coming weeks, up to $12 to $15 billion to pay for the wall, and exactly how that's done remains to be seen.

One thing we don't know yet is whether or not the Trump administration will try to seek spending cuts to offset the upwards of $15 billion for the new wall. This -- if he doesn't do that, it could prompt concerns from fiscal conservatives, who are worried about adding to the deficit. And we're not even talking about Democrats, who do have the power, if they stay largely united, to filibuster any sort of plan in the United States Senate, to fund the wall, if they did oppose what the president is doing.

So, a lot of questions about not exactly -- not just how he's going to pay for it, but whether he can get support from his own party and Congress more broadly to get behind it. And if he doesn't get that package through Congress, Wolf, it's an open question whether or not he can build a wall and whether he can fulfill one of his main campaign promises, Wolf.

Joining us now, a former ambassador to Mexico under President Obama, Tony Wayne.

Ambassador, thanks very much for joining us.

TONY WAYNE, FORMER U.S. AMBASSADOR TO MEXICO: It's a pleasure to be here.

BLITZER: What's your reaction? You were a U.S. diplomat in Mexico. You served there. Your reaction to this rapidly escalating feud between the U.S. and Mexico right now between these two presidents.

WAYNE: Well, it shows the danger of having foreign policy by short public announcements.

This is a country that is our second largest buyer of U.S. products. We have $1 million a minute in trade. We have a million border crossings, legal crossings, every day. They're very important for us against illegal immigrants from Central America in that effort, in drugs, fighting drugs.

[18:10:00]

And a whole range of topics, they're a key partner. And it is disturbing that we had a process moving forward to talk through the issues, to start negotiations on how to deal with those issues, and that's now been thrown off.

BLITZER: You spent four years in Mexico City as the U.S. ambassador. Do you see any way at all that President Trump can convince the Mexican government to pay for the wall?

WAYNE: Well, let me say that, in Mexico, this is a very emotional issue.

It's seen as a sign of disrespect and an issue of national dignity. So, there is a lot of pressure from all over the political spectrum on the president of Mexico not to cede on this issue.

They're willing, they're quite willing to talk on all of the range of issues, and try to work forward to find an agreeable way to move ahead. But on this issue, it just touches a very nationalist sentiment.

BLITZER: And what do you think of the fact that it's playing out to a certain degree on Twitter? Donald Trump has more than 22 million followers on Twitter. The Mexican president has more than six million followers on Twitter. They're tweeting to each other.

WAYNE: I think that what we should have are high officials from both governments sitting down and talking through the breadth and depth of these issues, and I'm sure we could find a common way forward. I don't think this is the best way to carry out foreign policy.

BLITZER: Stand by for a moment.

I want to bring in Mark Zandi, the chief economist at Moody's Analytics, to get a little economic perspective.

As you know, Mark, Mexico is America's second largest supplier of agricultural goods. If President Trump were to implement this 20 percent tax on Mexican exports to the United States, how could American consumers feel the impact?

MARK ZANDI, CHIEF ECONOMIST, MOODY'S ANALYTICS: It would mean higher prices, so the tariffs, the tax would be paid by American consumers in the form of higher prices for everything that we import from Mexico.

So that would be those agricultural products. It would be cars. It would be computers. It would be TVs, all of the above. Of course, also it would like hurt exporters, U.S. exporters, because the value of the dollar would rise and make U.S. exports more expensive.

And, you know, what's Mexico going to do here? Are they going to not respond? They seem to be responding to everything so far. So they may impose tariffs on U.S. exports to Mexico, and that would cost American jobs. So, you know, this is a lose-lose. It's obviously a crushing blow to Mexico, but it's also a loss to our economy, to our consumers and our businesses and our workers.

BLITZER: You're suggesting, if Mexico were to retaliate for that 20 percent tax, it could lead to a major trade war between these two countries?

ZANDI: Yes.

I mean, you know, of course, there's lots of scenarios here, right? And who knows how that plays out, but that's the point. We don't know how it plays out. And I will point out, you know, if you think back to the 1930s Great Depression, you know, a big cause of that Depression was this kind of tension around trade and Smoot-Hawley. That was the legislation we passed that increased tariffs on imported products.

And so I'm not suggesting we're going into the Great Depression, not that, but that's pretty instructive. We should look at that. That didn't work out so well, and I think this path would also work out very badly for all of us.

BLITZER: Is there anything positive about such a 20 percent tax?

ZANDI: No. There's nothing positive. This is a lose-lose all the way around.

And, you know, what signal does it send more broadly? The United States of America, since World War II, has been about embracing the rest of the world and getting the rest of the world to follow the rules, you know, through the WTO, through NAFTA, through other trade agreements. And if people cheat, we take them through an adjudication process and we show them that that's not the way to go.

And, yes, it's two steps forward, one step back, but we have all made a lot of progress here. And now we're talking about actually breaking the rules. So, you know, we're completely flipping this, all this hard work we have done since World War II, which has reaped enormous benefit for the world, and will reap much more benefit going forward to American workers, flipping it on its head.

And so maybe it works, maybe it doesn't. I'm not really sure, but it's certainly a pretty risky path to go down and not one that I would advise to go down.

BLITZER: Ambassador Wayne, is there any way the relationship between the U.S. president and the Mexican president can be salvaged?

WAYNE: Certainly, there is.

This is a very important relationship between two neighbors. I think there's certainly, if they get working on the issues, they have their teams work through the issues, they set the stage, we can get this relationship passed these early bumps and back on track.

BLITZER: But you don't see President Trump backing away from his often-stated pledge that the wall will be built and Mexico will eventually play for it? You don't see him backing away from that, do you?

[18:15:05]

WAYNE: I think he is moving forward on both of those fronts, but there are two parties involved here.

There are two countries. And Mexico is a sovereign country. They're our neighbor. We need to talk with them and recognize their interests, too. As was just mentioned, we have five million jobs that depend on what we sell to Mexico. That's an important U.S. interest. But you have to have two parties working on that.

BLITZER: Ambassador Wayne, thanks so much for joining us.

WAYNE: Thanks.

BLITZER: And, Mark Zandi, thanks to you as well.

We're learning more about President Trump's plans to move forward with this call for an investigation of voter fraud, despite the fact that the allegations have been widely debunked. The president and CEO of the NAACP, Cornell William Brooks, he's standing by to share his reaction.

(COMMERCIAL BREAK)

[18:20:10]

BLITZER: We're following the breaking news.

The White House says President Trump will back up his call for a voter fraud investigation with action. There's some question, though, about when the president will sign an executive order, but there's no question that allegations of voter fraud in the 2016 presidential election have been widely rejected as unsubstantiated and untrue.

Let's bring in our senior White House correspondent, Jeff Zeleny.

So what's the latest on all of this, Jeff?

JEFF ZELENY, CNN SENIOR WASHINGTON CORRESPONDENT: Wolf, President Trump was expected to sign that executive order in the Oval Office today around 4:30 p.m. It was that executive order to talk about voter fraud. It was to direct the executive branch of his government now to look into this.

But that didn't happen. We were told he arrived here at the White House late from his trip to Philadelphia, but it actually was not that late, so we're not sure if it was a scheduling issue or something else, but it was suddenly taken off his schedule.

His aides said it was simply postponed and he does intend to go forward with this. But, Wolf, the issue here is on voter fraud. When the president was addressing Republicans today at that retreat in Philadelphia, it did not come up much at all. He mentioned it a little bit in passing. They know there is very little appetite among Republicans on Capitol Hill to continue talking about this.

But he said he would sign an executive order to go forward with this and we will certainly keep an eye on that to see if he goes through with that. But one aide says, these executive orders, there have been so many of them, he's reviewing all of this to make sure that they specifically meet his specific requirements on this.

So it's possible that he was looking at this and didn't like some of the language in them. So, we will keep an eye on that for the next coming days. There's several others to come as well, Wolf, on immigration and other matters.

BLITZER: You know, a lot of observers have noted, it's a little odd that President Trump is touting all of his executive orders today, while Republicans spent years railing against President Obama for his executive actions, executive orders. What's the reaction over there?

ZELENY: It is, indeed, Wolf. And, certainly, the audience that he was meeting with today in Philadelphia, members of Congress, Republicans on Capitol Hill believe that President Obama overstepped his authority again and again with the executive branch vs. the legislative branch.

Most of the executive orders so far are not controversial, in their eyes. He is simply redoing a lot of the things that President Obama did with Obamacare, sort of setting that on a path forward to redo it. And most of them are also symbolic at this point. But, Wolf, you can tell just by watching this new president sign these

executive orders, it's almost as though at some points he's signing a piece of legislation. He shows it off and he's very proud of it. But, as we all know, getting a piece of legislation passed is much more difficult than signing an executive order here.

And they say there are several to go through. Really, they're sort of reinstating campaign promises and principles and setting up a direction for his government to go at. But, Wolf, I can assure you, if he starts signing executive orders usurping the authority of the legislative branch, even this Republican Congress will certainly have something to say about it.

BLITZER: Jeff Zeleny at the White House, thanks very much.

Let's talk about President Trump's relentless focus on these unsubstantiated claims of massive voter fraud.

Joining us now, the NAACP president and CEO, Cornell William Brooks.

Cornell, thanks very much for joining us.

CORNELL WILLIAM BROOKS, PRESIDENT, NAACP: Good to be here.

BLITZER: You tweeted this and it jumped out at me yesterday when I saw it. Last night, you tweeted this -- quote -- "Dear POTUS, president of the United States, I assure you, in the memory of NAACP martyrs, any executive orders suppressing votes will meet unrelenting resistance."

All right, explain to our viewers what you're talking about. That sounds like a threat.

BROOKS: No threat at all. It is, in fact, a promise and prediction.

We have seen in the course of this last election unrelenting voter suppression. We have seen our rights denied as Americans, particularly seniors, African-Americans, Latinos, and younger people.

And so, if the president insists upon conducting an investigation into voter fraud as a pretext for voter suppression, the NAACP, along with millions of Americans of every hue and heritage will resist. We will push back. We have, in the course of this campaign, in the context of -- in terms of 10 months and no less than 10 court victories against voter suppression.

So let's be clear about this, in terms of the facts. The president has claimed millions of fraudulent ballots cast. Here's what we know. The only place you will find millions of fraudulent ballots are right beside that fake birth certificate for Barack Obama inside the imagination of President Trump. It doesn't -- they don't exist.

[18:25:00]

Studies show again and again that fraud, voter fraud doesn't exist. There was a study that literally revealed, out of a billion ballots cast, 31 instances of voter fraud.

This administration, for it to double down on this notion of an investigation, we have already done this. In the Bush administration, we spent five years looking at 100 million ballots and literally discovered a handful of fraudulent ballots.

This is an -- this is a new, old, bad, expensive idea, the definition of fraud, waste, and abuse. We don't need to go down that road. In fact, what he needs to do is strengthen voting rights.

BLITZER: I spoke in the last hour with Democratic Senator Robert Menendez of New Jersey. He seems to suggest that this whole accusation of massive voter fraud is simply an excuse to engage in voter suppression, for example, get greater voter I.D. laws out there, which you would regard as voter suppression.

BROOKS: Absolutely.

Where we have one out of every 10 American voters not having a government-issued photo I.D., one out of every four African-Americans, we have seniors who don't have a government-issued photo I.D., to come up with onerous, burdensome voter I.D. requirements, where there's no need for it, to keep people from the polls, where we have seen state after state engage in this kind of activity, and where the federal courts, conservative courts, have held that states like Texas and North Carolina have engaged in voter suppression, via these bad, constitutionally, wrongheaded, morally wrong-hearted voter I.D. laws.

We don't have to go down that road. And I would strongly encourage the president to focus on ensuring access to the ballot box, instead of erecting barriers to the ballot box. This is something, literally, people have died for. Every day, when I walk into the NAACP headquarters, I have to walk past a bust of Medgar Evers.

He laid down his life for the right to vote. And so we -- if all due respect, if the president goes down this road, we must resist and we must resist massively.

BLITZER: And just to be precise, when you say unrelenting resistance, does that means protests, marches? What are you talking about?

BROOKS: It means protests, it means civil disobedience, it means litigation, it means a public education campaign, it means partnering with Americans all across the country, blue states and red states, who believe in the right to vote.

This is not partisan, it's not Democrat, it's not Republican. It is, in fact, American. And if all those legislators, all those senators and representatives who went to Selma only a few years ago, walked across the Edmund Pettus Bridge, looked into the eyes of people who risked their lives for the right to vote, they have got to stand with us and stand against voter suppression and stand against any policy by this administration to the contrary.

BLITZER: Cornell William Brooks of the NAACP, thanks so much for coming in. BROOKS: Thank you.

BLITZER: Thanks, Cornell.

Just ahead, the White House walks back on the idea of a 20 percent tax on Mexican exports to the United States to pay for a border wall. Would it start a trade war with the United States?

Plus, Britain's spy chief is revealing about the real-life inspiration for a classic James Bond character.

(COMMERCIAL BREAK)

BLITZER: The breaking news tonight, Mexico's president has canceled next week's planned meeting with President Trump at the White House in protest over Mr. Trump's plan for a new border wall.

[18:33:10] Let's dig deeper with our correspondents, commentators, and analysts. And Gloria Borger, let me start with you. The president in his speech today in Philadelphia, he said that he and the Mexican president, they agreed to cancel this meeting. That's not necessarily the case.

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: I don't think so. I think -- in fact, Sean Spicer called a mutual cancellation. I think it was one of those, I quit/you're fired situations, because as you know, Donald Trump tweeted this morning, said that -- and said that "If Mexico is unwilling to pay for the wall, then it's better to cancel the meeting."

And I think in Mexico, the president was getting a lot of pressure. He's got a -- what, a 12 percent popularity rating. And then he very quickly canceled right after that. So this is just a falling out of the relationship, and we have to just see if it can be repaired.

BLITZER: As you know, President Trump always says he's a great dealmaker; nobody can make a deal like him. But if he can't get into a room together with the Mexican president, how's he going to make a deal?

DANA BASH, CNN CHIEF POLITICAL CORRESPONDENT: Look, that could still come, eventually. He is still in campaign mode. He just is. He's still in campaign mode and, more specifically, in keeping campaign promises mode. I mean, it's just, what, day seven? Day six, I guess.

BORGER: They're blurring together.

BASH: Exactly. And what is the thing that we remember most about his campaign speeches? "I'm going to build a wall." And then it's interactive. "And Mexico is going to pay for it." You know, the trade deals. He's going to rip them up. NAFTA needs to be changed. I mean, that is it. That is the core of who he was and why he got, frankly, a lot of support from people who were never Republican voters before. New voters.

And so this is very much about him saying, "I told you I was going to be tough with Mexico, and I'm still going to be tough with Mexico. Look at this, you know? I'm standing up and I'm saying, 'You're going to pay for it, even if it means a hopefully short-term diplomatic riff'."

[18:35:07] We'll see. You know, he does know how to make a deal, if and when he needs to get that far. But right now, that's not where he is.

BLITZER: The White House, David, threw out this idea of a 20 percent tax on Mexican exports coming to the United States to pay for that wall. You know, is that something that Congress would go forward with?

DAVID SWERDLICK, ASSISTANT EDITOR, "THE WASHINGTON POST": Well, Wolf, on the one hand, I don't see a lot of signs yet that Republicans in Congress are really going to challenge President Trump. That being said, I think it's going to raise a lot of eyebrows.

First off, it would have to get past the Democratic filibuster in the Senate. The second thing is that, you know, when you talk about a 20 percent tax hike on Mexican imports, you're not just talking about potentially starting a trade war. You're also potentially raising the price of goods that go back and forth.

Patrick Gillespie from CNN Money just reported this afternoon that 40 percent of imports from Mexico involve parts that are from the United States in the first place. So prices can go up on both sides.

But this is part of this sort of border judgment tax idea that has been circulated by House Republicans, which Donald Trump a couple of weeks ago told "The New York Times" was too complicated, and he didn't like it.

So it is an idea that -- that has been out there. You know, the question is whether Americans will feel like they want to pay 20 percent more taxes on goods coming in from Mexico to pay for a border wall that a majority of them say shouldn't be built.

BLITZER: This is pretty extraordinary, the first few days of a new U.S. presidency, to have a crisis with one of the closest allies. A neighbor of the United States.

NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: Yes. And into this walks with British prime minister, the first world leader to come here and visit. And all of this shakedown with Mexico is happening literally while she's on the plane, flying from Britain this morning.

So she gets on the plane, and she thinks, "Hey, the next leader to come here, come to the United States after me will be the Mexican president." She gets off the plane and finds that's all gone.

But what's the subtext? What's the message for her when she goes in to meet with President Trump to try to get what she wants. What's the subtext? Is the subtext "my way or the highway"? Or can there be some accommodation? Is she going to recalibrate the way she's going to frame things with him? She was very strong and confident today when she spoke at -- to the Republicans in Philadelphia, but it may be different inside the closed doors of the White House.

BLITZER: We'll see what happens tomorrow.

Phil Mudd, the feud all unfolding over social media, while the State Department awaits the confirmation of the president's choice for secretary of state, Rex Tillerson. How risky is all of this?

PHIL MUDD, CNN COUNTERTERRORISM ANALYST: I don't think the risk relates to the confirmation hearing. I think that the -- Congress is going to decide -- the Senate is going to decide about Tillerson, based on his -- his own personal experiences, his background.

I think the question is fundamentally bigger, Wolf. It has to do with how the American government operates. Back after 9/11, President Bush set the strategic direction for America, starting with the invasion of Afghanistan. President Obama set a different strategic direction.

We are withdrawing from Afghanistan and Iraq, and you, the cabinet secretary, secretary of state, secretary of defense, have to execute my strategic direction. Look at how we're flipping that in seven days of a presidency.

On torture and black sites, the president says one thing, and his cabinet secretaries, I believe, are saying something else. Secretary Mattis, CIA director, are saying, "Not so fast."

On Russia, the president is saying, "We want to move forward." People like Mattis are saying, "Not so fast."

Now on Mexico, I think he's setting, potentially, if Mr. Tillerson is concerned as secretary, for his cabinet again to say, "You may think you're providing strategic direction, not so fast. Slow down. We've got to figure out a partnership with Mexico." It's almost flipping the role of the president and the cabinet.

BLITZER: Everybody, stand by. There's more coming up. President Trump's chief strategist in the White House lays into the news media, saying it should, quote, "keep its mouth shut." We have details of some scathing remarks and what they may reveal about the new administration.

(COMMERCIAL BREAK)

[18:43:43] BLITZER: We're back with our experts. We're following the breaking news. Gloria, President Trump, he spoke at this Republican congressional retreat today. Did the party leadership hear from him what they wanted to hear?

BORGER: Well, it's hard to tell. The Republicans I talked to are a little bit nervous, because they think the agenda is quite ambitious. They're worried about Obamacare and how they're going to replace it, after they repeal it.

And the president today said, you know, "Maybe we should have just let it go on for a couple of years, because now it's going to be ours." So he got a great response. And I think, you know, Wolf, you have to think about it this way.

This is an arranged marriage between the president and the Republican leadership. They weren't all there for him. And so it's a little bit of a delicate dance, but they seem to have embraced each other, at least for now. And he's their vehicle to get their agenda through, and we'll have to see where they part ways.

BLITZER: Dana, how daunting of a challenge is it now for the Republican leadership in the House and Senate to deliver on the president's promises?

BASH: Well, I think that there are things that are incredibly -- make them -- not daunting, but they're very excited about. Things like trying to repeal Obamacare, even though that's not going to be easy. Dealing with tax reform, which the House speaker and really Republicans across the board have been wanting to do for the entire eight years of President Obama.

[18:45:07] And then sort of go down the list of things.

I think that the things that will make Republicans in Congress say, uh, this isn't what we signed up for, are perhaps $10 billion to $12 billion in American taxpayer-funded building of a wall, because that certainly, as we were talking about before, was Donald Trump's campaign promise, but it was also for Mexico to do it. And if Mexico is not going to do it, and the wall is going to be built, it's American tax dollars that's going to go to pay for it. That's not going to be an easy sell to a lot of these constituents.

WOLF BLITZER, CNN ANCHOR: You're absolutely right.

David Swerdlick, the president's chief strategist in the White House, Steve Bannon, former Breitbart executive, former Goldman Sachs executive, he spoke to "The New York Times" and he was very, very tough on the news media. Among other things, he said this, "The media here is the opposition party. They don't understand this country. They still do not understand why Donald Trump is the president of the United States."

How unprecedented, if you believe it is, is this kind of talk from a chief White House strategist, going after the news media along these lines? Opposition party?

DAVID SWERDLICK, CNN POLITICAL COMMENTATOR: I think calling us the opposition in the first week of the administration is unprecedented, and, Wolf, I think it's unwarranted. It's true that most of us in the mainstream press did not predict that President Trump would win the election, but this narrative that's formed that we overlooked or forgot about Trump's supporters, I reject that. We covered it. We covered it for a year and a half in detail, painstakingly, and Trump won the election and now he's the president. And let's move forward from there.

BLITZER: Let me go to Phil Mudd. Let me read another quote from Steve Bannon. This is what he also told "The New York Times." "The media should be embarrassed and humiliated and keep its mouth shut and just listen for a while."

MUDD: But let me transition to a realistic conversation, because this is dead serious. There is a difference between campaigning and govern -- and I understand exactly what the Trump team was doing during the campaign. We are outsiders, we want to drain the swamp, we're not politicians and we're not represented by an elite media. I got that.

Now we transition from that campaign to governance. And you look at the role of media in governance over the decades of my life, in covering Vietnam, in covering Watergate, in covering Afghanistan and the war on terror, including what we did at CIA in black sites that we're talking about today, and fast forwarding and covering this fraudulent claim that there were fraudulent votes during the election. We're having an administration not understand in this transition from governance -- from campaigning to governance that the role of the media is not peripheral, it is core. And to my mind, even as a former CIA officer, that's nerve-racking. It makes me uncomfortable.

BASH: Hear, hear.

BLITZER: Nic, you're here in Washington now, but usually you're in London or someplace o overseas. How is the world watching what's happening here in Washington right now, reacting to comments like this from Steve Bannon, to the news media, "Keep your mouth shut, just listen for a while"?

NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: Yes, I think in the democracies of Europe, that's a shock. It's not the kind of language that would be used by politicians or their advisers there, however antagonistic the relationship can be in Britain, certainly has the press there certainly has a history of antagonism there towards leaders. You think of some of the newspapers there that outrightly come out against certain politicians running into elections.

So, this is something where others outside are looking in and thinking, what is happening? Where is this going? How are we going to respond to it? And then, perhaps, more specifically, how is this going to impact us?

You have elections in France coming up. You have elections in Holland coming up in the next couple of months. There are politicians in both those countries who are nationalists, who are populists, who are feeding off of this kind of message. And they'll continue to do it.

So, you know, for politicians, in democratic countries, this is a concern, that there are sort of renegade political groups that are emerging from the woodwork that are molding themselves in this fashion. How do they deal with it? And they will take, they will watch what happens here and they will try to learn lessons here of how the mainstream, if you will, political center of gravity in this country deals with this change.

BLITZER: Gloria, we've covered Washington for a long time. Other presidents and other administrations, they have criticized the news media, but still, this is pretty harsh.

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: Sure. Well, it is harsh, particularly just a week into the first term, right? But it's our job. It's our job.

And we did get a lot of things wrong, and I -- so, I get what Steve Bannon is saying there. But the notion that we ought to just sit back and not do our job is where I -- is where I disagree with him.

[18:50:01] And I think that, you know, the role is not to be a rubber stamp. We're not supposed to be state television here. We are supposed to ask the hard questions and I think we ought to keep doing that.

BLITZER: Dana?

BASH: I absolutely agree. I think that the idea of the media as the opposition party is a dangerous, scary thing, and it's up to us to just do what we do and not be any party, to be equally for the Republican president, Republican Congress, and Democrats in Congress, hold their feet to the fire, find and figure out how to have as much transparency as possible. That's our job, the best we can do.

BLITZER: We're not going to keep our mouth shut. That's for sure.

BASH: Not you, Wolf Blitzer.

BLITZER: Thank you very much.

There's more breaking news we're following. Will President Trump seek a new tax on imports from Mexico to pay for his border wall?

Plus, a surprise revelation about the real-life counterpart of a classic James Bond character.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: This is a class four grenade, three clicks, arms the four-second fuse, another three disarms it.

UNIDENTIFIED MALE: How long did you say the fuse was?

(END VIDEO CLIP)

(COMMERCIAL BREAK)

[18:55:40] BLITZER: He's a classic character in the James Bond movies and we're learning the real life counterpart of Q is a woman.

CNN's Brian Todd is working the story for us. Brian, Britain's spy chief actually made the revelation.

BRIAN TODD, CNN CORRESPONDENT: He did, Wolf.

Sir Alex Younger, the real life head of MI6, spoke at an awards event in London and revealed the real-life Q is indeed a woman. He's trying to encourage more women to join the intelligence services, especially on the technical side. And in the process, he's shattering a long- held and legendary notion about the agent who supplies James Bond with his gadgets.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: I'm your new quartermaster.

UNIDENTIFIED MALE: You must be joking.

UNIDENTIFIED MALE: Why, because I'm not wearing a lab coat?

TODD (voice-over): He's the young IT genius played by Ben Whishaw in "Skyfall" and "Spectre", the spy master who steers James Bond through his equipment challenges.

UNIDENTIFIED MALE: Zero to 60 in 3.2 seconds. Pretty bulletproof, a few little tricks up her sleeve.

TODD: Or he's the gadget guru in the older Bond films played by Desmond Llewellyn, constantly admonishing 007.

UNIDENTIFIED MALE: Bring that car back in pristine order.

TODD: The character Q, for quartermaster, has been a Bond legend for more than 50 years. Who could forget the underwater car or the exploding pen? But tonight the image of Q as a bookish oxford educated gentleman is shatter. Real head of Britain's overseas agency MI6 reveals, "I'm pleased to report the real-life Q is a woman." Her actual identity, of course, is top secret.

JONNA MENDEZ, FORMER CHIEF OF DISGUISE FOR CIA: Glass ceilings are being broken. We saw that at CIA when I was there.

TODD: Jonna Mendez worked in the CIA's version of Q's division and specialized in disguises. She gave me a convincing looking bruise to show her expertise. Mendez's husband is Tony Mendez, the CIA agent portrayed in the movie "Argo." She's thrilled that Q is a woman.

(on camera): What sensibilities does she bring as a woman that maybe a male Q would not bring to spy craft?

MENDEZ: An empathy, and ability to communicate with people, kind of a softness, not so much of an edge, but a natural ability to work with people -- a lot of the male leaders in these organizations seem to lack.

TODD (voice-over): As far as we know, a woman hasn't yet reached the very top of the MI6 other than Dame Judi Dench's role in the Bond films.

UNIDENTIFIED MALE: So, this is the Aston Martin DB5, the famous car from "Goldfinger."

TODD: Vince Hogan is curator and historian of the International Spy Museum. He showed us real spy gadgets Q's team might have actually used.

UNIDENTIFIED MALE: A wristwatch. The idea behind this is you can have a secret way to take photographs, making a coin that is hollowed out to where you could put like a microchip or put a small document.

TODD: But as for the souped-up spy gadgets in the movies --

UNIDENTIFIED MALE: If you find yourself needing an ejector seat, in a shoot-out or car chase in a foreign country, things have gone badly, your operation is blown.

(END VIDEOTAPE)

TODD: So, rather than machine guns and ejector seats on sports cars, Vince Hogan says what Q and her team at MI6 really spend a lot of their time creating are things like fake IDs, fake documents, even fake receipts to show that an agent might have shopped at a store in a given city, creating all the tools that agents really need to effectively operate in their target cities and that they need to stay alive -- Wolf.

BLITZER: Brian, what other impressions of James Bond is the real head of MI6 trying to dispel?

TODD: Well, Alex Younger said, Wolf, that in real life, James Bond really wouldn't get through their recruitment process. He says they're not looking for MI6 officers to take what he called moral short cuts. Younger said an intelligence officer in the real MI6 has high emotional intelligence, he values teamwork and he always has respect for the law, unlike Mr. Bond, he says.

BLITZER: All right. Brian Todd, reporting for us. Good report. Appreciate it very much.

This programming note -- starting next month, right here on CNN, you can see the most iconic moments in comedy from stand-up to sitcom. CNN's new original series "The History of Comedy" starts Thursday, February 9th, 10:00 p.m. Eastern. Looking forward to that.

That's it for me. Thanks very much for watching. I'm Wolf Blitzer in THE SITUATION ROOM.